Chapter 6.68

USED AUTOMOBILE DEALERS*

Sections:

• 6.68.020 Sale of more than two automobiles per year - Burden of proof.

• 6.68.030 Unlawful to operate as used automobile dealer without permit.

• 6.68.040 Permit - Application requirements - Fee.

• 6.68.050 Permit - Application - Investigation by chief of police -Issuance conditions - Term.

• 6.68.060 Permit - State license and number prerequisite.

• 6.68.070 Permit - Required for each partner or associate.

• 6.68.080 Permit - Required for additional places of business.

• 6.68.090 Permit - Display required.

• 6.68.100 Change of business location or ownership - Fee.

• 6.68.110 Permit - Termination when business discontinued - Exceptions.

*State law references— For statutory provisions on vehicle salesmen, see Vehicle Code § 11800 et seq.; for provisions on identifiable secondhand personal property, see Bus. and Prof. Code § 21625 et seq.

• 6.68.120 Permit - Grounds for suspension or revocation.

• 6.68.130 Hearing on permit suspension or revocation - Notice.

• 6.68.140 Notice - Service requirements.

• 6.68.150 Notice - Service by mail when.

• 6.68.160 Additional suspension or revocation powers of chief of police.

• 6.68.170 Conduct of business - Principals responsible.

• 6.68.180 Conduct of business - Location restrictions.

• 6.68.190 Certain advertisements and sales prohibited.

• 6.68.200 Records to be kept - Reports to police.

• 6.68.210 Salesmen - Dealer to report certain information.

"Used automobile dealer" means any person engaged in managing or carrying on the business of buying or taking in trade, for the purpose of resale, selling or consigning to be sold, trading or otherwise dealing in used motor vehicles, as the term "motor vehicles" is defined in the State Motor Vehicle Code; provided, however, that no insurance company, finance company, transportation company or any other person coming into the possession of such vehicle in the regular course of business who shall sell such motor vehicles under its contracted rights or obligations, or to save itself from loss, shall be deemed a used automobile dealer. (Prior code § 6503.1.)

Any person selling, or participating in the sale, either as a principal or agent, except as an employee of a dealer licensed under this chapter, of more than two automobiles in any calendar year, shall be deemed a used automobile dealer, and the burden

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of providing that such person, firm or corporation is not in fact operating as a used automobile dealer shall be placed upon such person. (Prior code § 6503.2.)

No person shall engage in, manage or carry on the business of used automobile dealer within the city without a permit therefor issued by the chief of police, and without a fixed place of business for the conduct thereof, adequate for display of not less than three automobiles, at which place of business shall be displayed all vehicles offered for sale or exchanged in said business. (Prior code § 6503.22.)

• A. No person shall hereafter engage in any business as a used automobile dealer without first having received a permit in writing so to do from the chief of police.

• B. Before receiving or acting upon any application for the granting of a permit to engage in business as a used automobile dealer, the chief of police shall require:

  1. The payment of the sum of fifty dollars as an application fee, no part of which shall be refunded;

  2. An application, signed by the applicant, showing that said applicant is to conduct the business of dealing in used automobiles at a fixed place of business where used motor vehicles are, or will be displayed for sale. Said application for a permit shall be in writing on a form provided by the chief of police and shall be signed by the applicant, and if the applicant is a corporation, association or partnership, the same must be signed by a duly authorized officer on behalf of the corporation, or by all the members of the partnership or association, and the same must contain the names and addresses of

all officers of the corporation, or of all the partners or associates. Said application shall be verified by the applicant, and if said applicant is a corporation, association or partnership, said verification shall be made by an officer of said corporation, or by a member of said partnership or association.

(Prior code § 6503.3.)

Upon receipt of said application, as provided in the Section 6.68.040, the chief of police shall investigate the character and business of the applicant, and the location at which such applicant proposes to engage in business as a used automobile dealer, as stated in said application, and thereafter may issue a permit to said applicant which shall be effective for an indefinite term, subject, however, to all of the provisions of this chapter as now in effect (and as said chapter may be subsequently amended) including, but not limited to, all provisions of this chapter as now in effect (and as the same may be subsequently amended) relating to revocation or termination of permits issued under said chapter; provided, however, that no permit shall be issued to an applicant not of good character, good reputation and moral integrity, provided that violation of any provision of this chapter shall of itself be deemed prima facie evidence of lack of good character, good reputation and moral integrity; and provided further, that no permit shall be issued unless the location at which applicant proposes to engage in business is within a district in which such business is permitted by the zoning ordinances of the city. Said investigation by the chief of police must contain a verification of the place of residence and business activities of the applicant for ten years immediately prior to the date of the application. (Prior code § 6503.12.)

Every used automobile dealer must have, in addition to the permit required by the preceding

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sections of this chapter and Section 6.68.070, 6.68.080 and 6.68.100, a state license, and must post and file with the chief of police prior to issuance of a permit the number assigned by the Motor Vehicle Department of the state to such dealer under his state license, and in the event the State Motor Vehicle Department refuses to issue to any dealer a state license, the chief of police must revoke or refuse to issue such permit to such dealer, it being mandatory that all permittees hereunder shall at all times be in possession of a state dealer's license in full force and effect.

(Prior code § 6503.16.)

No person shall be admitted as a member of any partnership or association permitted to engage in business as a used automobile dealer unless such person shall have first obtained a permit to engage in business as a used automobile dealer in accordance with the provisions of this chapter. (Prior code § 6503.14.)

Any used automobile dealer having at least one place of business under a valid permit issued pursuant to this chapter may file an application for a permit for an additional location upon payment of the sum of five dollars for each such application. Only one person may conduct a used automobile dealer's business at any location, unless any other person desiring to conduct such a business at the same location shall, before engaging therein, be issued a permit therefor by the chief of police, in conformity with the provisions of the preceding sections of this chapter and Section 6.68.100. (Prior code § 6503.15.)

The permit of each person licensed as a used automobile dealer under the provisions of this chapter shall be prominently displayed in the place of business of such dealer. (Prior code § 6503.20.)

A fee of five dollars shall be charged for any application for a change of location of the place of business for which a permit has been granted as a used automobile dealer, and a fee of five dollars shall be charged for a change of ownership; provided, however, that the fee of five dollars charged for a change of ownership shall apply only in cases where the new owner is at such time engaged in business as a used automobile dealer under a permit theretofore issued therefor.

(Prior code § 6503.13.)

Anyone now or hereafter holding a permit as a used automobile dealer who discontinues business for a period exceeding ninety days, thereby relinquishes all right or interest in said permit, and said permit is thereby terminated and revoked without requirement of action on the part of the chief of police, or otherwise. Any used automobile dealer regularly licensed hereunder as such, who is a member of the military forces of the United States in time of war, shall not be subject to fee for such permit for such period, nor until released from such service, when his permit shall be restored to him in full effect. If he does not reestablish himself as such dealer within ninety days from his release from such service, then such permit shall be deemed terminated and revoked as hereinbefore provided. (Prior code § 6503.17.)

In the event that any person holding a permit as a used automobile dealer violates any of the provisions of this chapter, or of any law or ordinance of the city relating to such used automobile business; or fails to pay, within thirty days after same shall have become final, any judgement entered against him arising out of the misrepresentation of any motor vehicle, or out of any fraud committed in connection with the sale of any motor

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vehicle; or is guilty of any other conduct, whether of the same or of a different character than hereinabove specified, which constitutes fraud or dishonest dealing, it shall be the duty of the chief of police, in addition to the other penalties provided herein, to suspend or revoke the permit issued for carrying on such business. In the event any such permit issued to any person shall be revoked by the chief of police, no permit shall be granted to such person to carry on such business within six months from the date of such revocation. (Prior code § 6503.24.)

No permit shall be suspended or revoked until a hearing shall have been had by the chief of police relating to such suspension or revocation, notice of which hearing shall be given in writing to the permittee and served at least five days prior to the date of the hearing thereon. (Prior code § 6503.25.)

Said notice shall state the ground of complaint in form sufficient to give notice thereof and the time and place of hearing thereof. Said notice shall be served upon the holder of such permit by delivering the same to such permittee or agent thereof, or to any person in charge of, or employed in the place of business of such permittee, or if such permittee has no place of business, then at the place or residence of such permittee, if known, or by leaving such notice at the place of business or residence of such permittee. (Prior code § 6503.26.)

Under the provisions of this chapter, the chief of police shall have power to suspend or revoke the permit of a corporation as to any officer acting under its permit and the permit of a partnership as to any member acting under its permit, without suspending or revoking the permit of such corporation or such partnership. (Prior code § 6503.28.)

Every person operating under the provisions of this chapter shall be held strictly responsible for the conduct of all employees in all transactions regarding used automobiles or other motor vehicles; nor shall such dealer permit any person to sell, purchase or exchange any used automobile or other motor vehicle upon the premises specified in his permit unless such person also has a permit as provided in this chapter, or is an employee of a person having such permit. (Prior code § 6503.21.)

No used automobile dealer shall sell any used automobile or other motor vehicle from any place other than the fixed and established place of business for which the permit therefor has been granted by the chief of police, except that such sales may be made by a licensed used automobile dealer from the registered place of business of any used automobile dealer holding a permit under this chapter. (Prior code § 6503.30.)

In the event the permittee cannot be found, and the service of such notice cannot be made in the manner provided herein, then a copy of such notice shall be mailed, postage fully prepaid, addressed to such permittee, at the place of business or residence set forth in said permit or the application therefor, at least five days prior to the date of such hearing. (Prior code § 6503.27.)

No used automobile dealer shall advertise for sale in any newspaper, or through any other medium, any automobile not actually for sale at the premises of such dealer at the time the advertisement is inserted in the newspaper or other medium. Within forty-eight hours after any automobile that

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has been advertised for sale has been sold or withdrawn from sale, the used automobile dealer offering the same shall request withdrawal, in writing, of any advertisement relative to such automobile, from any newspaper or any other medium publishing the same.

(Prior code § 6503.29.)

Every used automobile dealer shall keep a record of the purchases, consignments, sales and exchanges of each motor vehicle purchased, sold, consigned to be sold, or exchanged by such dealer, and said record shall at all times be open to the inspection of the chief of police, or any peace officer. Said record shall contain the name and address of the person from whom purchased or received, and the make, state license number, motor number, serial number, style and seating capacity of any used motor vehicle purchased or received, and the make, state license number, motor number, serial number, style and seating capacity of any used motor vehicle purchased or received. (Prior code § 6503.19.)

Every person having a permit as a used automobile dealer shall, within ten days hereafter, file with the chief of police the name and address of each person employed by him who contacts the public to any extent in a sales capacity, and shall hereafter file with the chief of police the name and address of additional such persons immediately upon their employment. (Prior code § 6503.23.)